Benzene Prices in the US Market Unstable Due to Crude Oil and Panama Canal Challenges
Benzene Prices in the US Market Unstable Due to Crude Oil and Panama Canal Challenges

Benzene Prices in the US Market Unstable Due to Crude Oil and Panama Canal Challenges

  • 02-Nov-2023 3:50 PM
  • Journalist: Emilia Jackson

Benzene prices in the US market continued to follow the swing, backed by the fluctuating crude oil and naphtha production rate accompanied by the final selling prices. The decline in crude oil prices in prominent physical markets is attributed to increased shipping expenses and decreased refining profit margins. This suggests a potential drop in demand for Benzene and its derivative aromatic products that may impact the future market of Benzene. The decrease in physical crude oil prices might foreshadow a decline in crude oil futures. The rise in the WTI crude oil prices is mainly due to OPEC+ supply reductions and, more recently, concerns about reduced Middle East exports amid the escalating Gaza conflict. The Benzene prices were evaluated at $1245 per metric ton, FOB Louisiana, in the US market in the last week of the tenth month of 2023.

The decrease in crude oil prices was predominantly a result of apprehensions about how rising borrowing expenses could adversely affect economic expansion and, consequently, the demand for fuel. Alongside these worries, the Energy Information Administration (EIA) released an unanticipated rise in crude oil stockpiles within the United States. Traders are anxiously awaiting the Federal Reserve's statement and closely monitoring developments in the Middle East. The Fed is anticipated to maintain unchanged interest rates, which could positively impact the Benzene market. Similar expectations are held for the European Central Bank, particularly after an initial estimate of Eurozone inflation indicated a significant decrease and counter impacts can be seen in the Benzene prices in the domestic market.

A prolonged period of drought has resulted in a shortage of water needed to facilitate the raising and lowering of ships in the canal, impacting the Benzene trade flow in the domestic market in the Panama Canal. Consequently, authorities have had to reduce the number of vessels permitted to pass through the canal. This situation has presented costly challenges for shipping companies and sparked complex inquiries into water management practices in Panama. The supply chain of Benzene may get hampered in the upcoming weeks.

Without the addition of a freshwater supply, the canal may experience a substantial decline in its trade volume. While alternative maritime routes are indeed lengthier and costlier, they tend to be more reliable in avoiding unexpected delays. As per ChemAnalyst, the Benzene prices in the domestic market are expected to remain on the softer side of the overall selling range as the production cost and final selling prices may be significantly impacted by the geopolitical issues, improved supply chain, and fluctuating WTI crude oil prices.

Related News

Benzene Prices Jump in the US Catapulted by the Limited Supply
  • 20-Feb-2024 5:56 PM
  • Journalist: Harold Finch
Increased Demand And Rising Delivery Rates Push Benzene Prices In Europe
  • 06-Feb-2024 6:20 PM
  • Journalist: Harold Finch
Weekend Benzene Leak at Corunna Site Prompts Nova's Probe
  • 24-Jan-2024 2:22 PM
  • Journalist: Patricia Jose Perez
European Benzene Prices Rise Amidst Geopolitical Tensions, Supply Disruptions, and Rising Production Costs
  • 18-Jan-2024 4:03 PM
  • Journalist: Patrick Knight